ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION

The following discussion of our financial condition and results of operations
should be read in conjunction with our financial statements for the years ended
June 30, 2013 and June 30, 2012, together with notes thereto as included in this
Annual Report on Form 10-K. The following discussion contains forward-looking
statements that reflect our plans, estimates and beliefs. Our actual results
could differ materially from those discussed in the forward looking statements.
Factors that could cause or contribute to such differences include, but are not
limited to those discussed below and elsewhere in this Annual Report,
particularly in the section entitled "Risk Factors." Our audited financial
statements are stated in United States Dollars and are prepared in accordance
with United States Generally Accepted Accounting Principles.

We are a developmental stage company and have not generated any revenue to date.
We have incurred recurring losses to date. Our financial statements have been
prepared assuming that we will continue as a going concern and, accordingly, do
not include adjustments relating to the recoverability and realization of assets
and classification of liabilities that might be necessary should we be unable to
continue in operation.

We expect we will require additional capital to meet our long term operating
requirements. We expect to raise additional capital through, among other things,
the sale of equity or debt securities.

RESULTS OF OPERATION

Fiscal Year Ended June 30, 2013 Compared to Fiscal Year Ended June 30, 2012

Our net loss for fiscal year ended June 30, 2013 was $10,194,010 compared to a
net loss of $53,009 during fiscal year ended June 30, 2012, a substantial
increase of $10,141,001. The majority of the loss is attributable to non-cash
expenses of derivative interest expense and loss on sale of subsidiary which
total $9,480,702. These non-cash expenses are described in detail below. During
fiscal years ended June 30, 2013 and June 30, 2012, we did not generate any
revenue.

During fiscal year ended June 30, 2013, we incurred operating expenses of
$713,308 compared to $76,815 incurred during fiscal year ended June 30, 2012, an
increase of $636,493. During fiscal year ended June 30, 2013, our operating
expenses consisted of: (i) $264,116 (2012: $-0-) in consulting; (ii) $222,010
(2012: $76,815) in general and administrative; (iii) $46,833 in professional
fees (2012: $-0-); (iv) $93,831 in travel (2012: $-0-); and (v) $86,518 in wages
(2012: $-0-). The increase in operating expenses was primarily attributable to
the increases in consulting fees, professional fees, travel and wages. General
and administrative expenses also generally include corporate overhead, financial
and administrative contracted services, marketing, and consulting costs.

We incurred management fees is the amount of $204,092 and $-0- to our
officers and directors during fiscal years ended June 30, 2013 and June 12,
2012. See "Item 11. Executive Compensation."

During fiscal year ended June 30, 2013, we incurred other expense in the form
of: (i) interest expense associated with the derivative liability on our
outstanding convertible notes payable of $9,448,441 (2012: $-0-) and (ii)
$32,261 in loss on sale of subsidiary (2012: $-0-).

Therefore, our net loss and loss per share during fiscal year ended June 30,
2013 was $10,194,010 or $0.10 per share compared to a net loss and loss per
share of $53,009 or $0.00 per share during fiscal year ended June 30, 2012. Net
loss increased substantially during fiscal year ended June 30, 2013, as compared
to June 30, 2012, as a result of the derivative interest expense attributable to
the outstanding convertible notes payable. The weighted average number of shares
outstanding was 107,081,164 and 201,125,000 for fiscal years ended June 30, 2013
and June 30, 2012.

LIQUIDITY AND CAPITAL RESOURCES

Fiscal Year Ended June 30, 2013

As of June 30, 2013, our current assets were $28,196 and our current liabilities
were $10,222,206, which resulted in a working capital deficit of $10,194,010. As
of June 30, 2013, current assets were comprised of $28,196 in cash. As of June
30, 2013, current liabilities were comprised of: (i) $7,765 in accounts payable;
(ii) $766,000 in convertible note payable; and (iii) $9,448,441 in derivative
liability.

As of June 30, 2013, our total assets were $28,196 comprised entirely of current
assets. The increase in total assets during fiscal year ended June 30, 2013 from
fiscal year ended June 30, 2012 was due to the increase in cash of $28,196.

As of June 30, 2013, our total liabilities were $10,222,206 comprised entirely
of current liabilities. The increase in liabilities during fiscal year ended
June 30, 2013 from fiscal year ended June 30, 2012 was primarily due to the
recording of $9,448,441 in derivative liability and $766,000 in convertible
notes payable. The derivative liability was related to the outstanding
convertible notes payable issued in the fiscal year end June 30, 2013.

Stockholders' deficit increased from $209,015 for fiscal year ended June 30,
2012 to $10,194,010 for fiscal year ended June 30, 2013

Cash Flows from Operating Activities

We have not generated positive cash flows from operating activities. For fiscal
year ended June 30, 2013, net cash flows used in operating activities was
($690,781) compared to ($-0-) for fiscal year ended June 30, 2012. Net cash
flows used in operating activities consisted primarily of a net loss of
$9,448,441 (2012: ($53,009), which was adjusted by $9,448,441 (2012: $-0-) of
derivative interest calculated from the outstanding convertible notes, $209,015
(2012: $-0-) of debt forgiveness from past debt related to Colorado Ceramic
Tile, Inc., $200 (2012: $-0-) of related party payables, and $154,027 (2012:
$76,815) of accounts payable.

Cash Flows from Investing Activities

For fiscal years ended June 30, 2013 and June 30, 2012, net cash flows used in
investing activities was $-0-.

Cash Flows from Financing Activities

We have financed our operations primarily from debt or the issuance of equity
instruments. For the fiscal year ended June 30, 2013, net cash flows provided
from financing activities was $718,977 compared to $-0- for fiscal year ended
June 30, 2012. Cash flows from financing activities for fiscal year ended June
30, 2013 consisted of $766,000 in proceeds from convertible notes payable which
was offset by $47,023 from repayment of notes payable.

PLAN OF OPERATION AND FUNDING

We expect that future working capital requirements will to be funded through a
combination of our existing funds, debt and equity, and potential generation of
revenues. Our working capital requirements are expected to increase in line with
the growth of our business.

Our principal demands for liquidity are to increase research and development,
capacity for developing products, inventory purchase, potential sales
distribution, and general corporate purposes. We intend to meet our liquidity
requirements, including capital expenditures related to the purchase of
equipment and/or inventory, and the expansion of our business, through cash flow
provided by funds raised through proceeds from the issuance of debt or equity.

Existing working capital, further advances and debt instruments, and anticipated
cash flow are expected to be adequate to fund our operations over the next six
months. We have no lines of credit or other bank financing arrangements. We may
finance expenses with further issuances of securities and debt issuances. Any
additional issuances of equity or convertible debt securities will result in
dilution to our current shareholders. Further, such securities might have
rights, preferences or privileges senior to our common stock. Additional
financing may not be available upon acceptable terms, or at all.

MATERIAL COMMITMENTS

Revolving Loan

The Company carried a revolving, due on demand, variable interest rate line of
credit with a bank, providing for a credit line up to $50,000, secured by all
Company assets. When the Company's tile business was disposed of in March 2012
to a former officer, the line had a principal balance of $47,023 plus accrued
interest of $226. At June 30, 2013 and 2012 the balance due against the line of
credit was $-0- and $47,023, respectively.

Accrued interest payable under all notes payable at June 30, 2013 and 2012 was
$0 and $226, respectively.

Convertible Note Payable

On December 30, 2012, the Company entered into a convertible promissory note
with Globe Financial Corp. for $201,000, bearing no interest and convertible at
a 50% discount to market. The note is payable on demand. As the conversion rate
is discounted to market, the Company calculated a derivative liability of
$2,455,751 at June 30, 2013 using the Black Scholes Model.

On December 31, 2012, the Company entered into a convertible promissory note
with Globe Financial Corp. for $90,000, bearing no interest and convertible at a
50% discount to market. The note is payable on demand. As the conversion rate is
discounted to market, the Company calculated a derivative liability of
$1,175,578 at June 30, 2013 using the Black Scholes Model.

On January 5, 2013, the Company entered into a convertible promissory note with
Asus Global Holdings Inc. for $475,000, bearing no interest and convertible at a
50% discount to market. The note is payable on demand. As the conversion rate is
discounted to market, the Company calculated a derivative liability of
$5,817,112 at June 30, 2013 using the Black Scholes Model.

At June 30, 2013 and 2012 the the balance due against these three convertible
notes was $766,000 and $-0-, respectively.

PURCHASE OF SIGNIFICANT EQUIPMENT

We do not intend to purchase any significant equipment during the next twelve
months.

OFF-BALANCE SHEET ARRANGEMENTS

As of the date of this Annual Report, we do not have any off-balance sheet
arrangements that have or are reasonably likely to have a current or future
effect on our financial condition, changes in financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital
resources that are material to investors.

GOING CONCERN

The independent auditors' report accompanying our June 30, 2013 and June 30,
2012 financial statements contains an explanatory paragraph expressing
substantial doubt about our ability to continue as a going concern. The
financial statements have been prepared assuming that we will continue as a
going concern, which contemplates that we will realize our assets and satisfy
our liabilities and commitments in the ordinary course of business. We have
suffered recurring losses from operations, have a working capital deficit and
are currently in default of the payment terms of certain note agreements. These
factors raise substantial doubt about our ability to continue as a going
concern.

RECENTLY ISSUED ACCOUNTING STANDARDS

The following describes the recently issued accounting standards used in
reporting our financial condition and results of operations. In some cases,
accounting standards allow more than one alternative accounting method for
reporting. Such is the case with accounting for oil and gas activities described
below. In those cases, our reported results of operations would be different
should we employ an alternative accounting method.

In July 2012, FASB issued ASU No. 2012-02, Intangibles - Goodwill and
Other. This update presents an entity with the option to first to assess
qualitative factors to determine whether it is more likely than not that an
indefinite-lived intangible asset is impaired as a basis for determining whether
it is necessary to perform the quantitative impairment test in accordance with
Subtopic 350-30, Intangibles - Goodwill and Other - General Intangibles Other
than Goodwill. The more-likely-than-not threshold is defined as having a
likelihood of more than fifty percent. ASU No. 2012-02 will be effective for
annual and impairment tests performed for fiscal years beginning after 15
September 2012, with early adoption permitted. The Company does not expect the
adoption of this update will have a material effect on its financial statements.

Our management does not believe that any other recently issued, but not yet
effective accounting pronouncements, if adopted, would have a material effect on
the accompanying financial statements.